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Industry News

Published on August 20th, 2021 | by The GC Team

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Consumers in saving mode as confidence dips

Consumer confidence dipped slightly in August, but expectations for personal finances held up well as the inclination for spending on major purchases gave way to saving.  

GfK’s monthly Consumer Confidence Index dropped one point to -8, with changes in personal finances over the last 12 months up one point to 0, five points ahead of August 2020, and the forecast for the next 12 months remaining the same at +11, ten points higher than at this time last year.

The measure for the general economic situation of the country during the last 12 months rose one point to -42, twenty points higher than in August 2020, while expectations for the coming 12 months dipped by one point to -6 but remain 36 points higher than the same period last year.

Joe Staton, Client Strategy Director GfK, described the headline Index figure of -8 as “stable” against a backdrop of cooling headline inflation and soaring house prices, and said expectations for personal finances for the coming 12 months bodes well for the economy going forwards this year and next.

The most notable change in the August data was seen in the Major Purchase Index, which decreased five points to -3 and was counterbalanced by the Savings Index, which increased five points to +25. UK consumers have built their savings to record levels during COVID and this latest turn comes at a time of rising prices throughout a number of goods and service industries.

Nonetheless, there are reasons to be cheerful. “With the economy continuing to open up and GDP bouncing back, the overall picture for the economic health of the nation is looking good for the remainder of 2021,” Staton commented.

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